Research and development (R&D) tax credits explained by our specialists.
What is R&D Tax Relief?
- They are a valuable UK Government tax incentive available to all Limited businesses.
- It rewards limited companies who are striving to develop new and improved ways of doing things.
- E.g. new or improved Products, services, systems, devices.
- This class of tax relief is worth up to £33,350.00 back for every £100,000 of qualifying expenditure spent on seeking innovation.
- This incentive is designed to encourage the pursuit of innovation in a business to achieve an advance.
- Research and development tax relief is by far the most appealing incentive available to UK businesses.
Small to medium sized enterprises (SME's) as well as larger companies companies may claim R & D when they have spent money developing or enhancing:
Get leading industry news, business automation tips and free software delivered straight to your inbox.
Receive infrequent, yet insightful business tips and ideas that will strengthen your company.
Companies can claim for failed or shelved projects as well as successful ones.
Tax relief is often used as an alternative to traditional business funding options.
Invest cash rebates in future business projects. Reductions in tax liability also improve the bottom line.
The potential for dual-awards helps businesses striving to innovate.
Is Your Company Seeking an Advance?
It's important that your business is attempting something new to create an advance in your industry.
The advance must not be trivial.
By combining scientific principles e.g. trial and error, iterations, new methods, approaches etc. then this may provide a basis for an R&D claim.
When the way forward is not immediately obvious you may be eligible to claim R&D tax credits.
Claim up to 33.3% of your eligible business costs back fast.
The UK government is strict on only allowing a business to claim back 2 years. If your financial year-end is approaching and you’ve not yet claimed, call our specialists now so you don’t lose out.
"Why is that?" we hear you say...
Legislation dictates that a business can only recover the last two open tax-years. If you fail to claim, you will lose any recoverable costs falling outside of this 2-year limit. So, make certain that you claim because you could miss out on large sums if you don't.
The current incentive provides an extra 130% enhanced relief on top. This pot of deductible spend reduces your CT bill.
If surrendered as a loss, you may be eligible for an immediate cash rebate within a 6-9 week period.
What Expenditure Qualifies for R&D?
Let’s not forget that the reason the incentive exists is to drive innovation.
The UK Government and treasury win when your business does.
Providing your business is seeking a genuine advance that's unique then you may be able to claim R&D.
Expenditure has to be allocated to projects that are trying to secure an advance in your field.
Your Business May Be Eligible to Claim When:
You might have an idea and not know if it will work.
If your business is striving to make your idea a reality this may highlight a potential claim.
Hit a roadblock? Had to go back to the drawing board? Had to rethink? This could also highlight a potential claim.
HMRC is currently chasing many businesses in the UK who have filed false claims. This highlights the importance of using a specialist.
Your claim must be correct and include the correct costs, fees and applicable rates.
The world doesn't expect all your projects to succeed but we admire your trying.
What R&D Costs Can Be Recovered?
We help companies from all over the United Kingdom recover large sums of money every year.
We are trusted partners to accountancy practices who are members of the ICAEW and ICCA across the United Kingdom.
Save time and money by utilizing our specialists to help with your claim.
Our streamlined process limits your time to two hours over a 6 to 9-week period.
Sector specialists distill all relevant information.
Next, we prepare a clear report accepted and approved for HMRC.
We work on a 100% success only basis. If we are unsuccessful in establishing the basis of a claim, then there is no cost for our specialists time.
“We were initially skeptical as we didn't realize many of our mundane daily activities we had grown used to could be considered R&D”
Our team takes on the full cost of managing your R&D tax claim. Should no claim be possible, then it will cost you nothing for our time.
Start-up companies, as well as small to medium enterprises (SME's), are often at the cutting edge of industry. They surface because they see something different and aren't anchored by 'the way it used to be.'
More agile businesses often capitalize on opportunities quicker. They have often spotted a gap in the market, a problem that they want to solve.
Innovative companies often use new, cutting-edge, and often untested ways of doing things. An average claim made by a Small to Medium Enterprise (SME) is now over £46,000.00
Research and development expenditure credits are a quick and efficient way to give your business's bottom line a boost.
Will Subsidies and Grants Affect My Claim?
When your company has benefited from grants/subsidies you may still claim.
You would claim by way of RDEC incentive which is another R&D scheme.
More often than not the R&D benefit is at a rate of 11% when there is a grant involved.
Hamilton Wood & Company can help optimize your claim regardless of how complex your organizations structure.
I Have a Business Overseas, Will This Prevent My Claim?
You may still be able to claim if your business is overseas.
It is important to establish if your business is an 'independent' or if it is 'controlled' by another entity.
To help decide this, consider the number of employees, assets, turnover etc.
After this appraisal, it could be that you would claim via the RDEC R&D scheme.
A lot of the time your company status and size can be unclear yet, get this wrong at your peril.
Establishing exactly what rules apply can be a confusing and daunting process.
Our specialists are happy to help with any technical aspects of your claim.
If you have any questions relating to any of your business's projects feel free to get in touch; we're here to help you.
We provide an award winning RD tax service to help strengthen your business.
R&D Tax Credits
We help UK businesses safely optimize their R&D claim.
Our specialists help businesses with professional Capital Allowance claims.
Business Loans UK
We provide access to some of the UK's leading small business loans.
Join over 5,000 other businesses by signing up to our business growth newsletter.
Get infrequent, yet powerful business insights designed to strengthen your business.